David Cameron is today pledging £6bn to boost regional jobs, transport and construction in a bid to boost growth across the country in the run up to next year’s election.
The biggest chunk of spending nationally under the three-year scheme will be £3bn on transport, with major links being built between northern cities.
The capital is getting £236m of the £6bn spent by Local Enterprise Partnerships (LEPs) nationally, with the PM and Boris Johnson promising thousands of new homes and jobs.
The plan is to co-ordinate spending more efficiently – and to show the government is able to plan for the long-term, moving on from the 2010 election campaign which was based on cutting the budget deficit.
Manufacturers’ group EEF said the PM should be cautious spending so much on an untested set up.
The government must “make sure LEPs have the opportunity to demonstrate their ability to deliver before more funding and capabilities are devolved in the future,” said its chief economist Lee Hopley.
The £2bn per year was announced last year, but the LEPs have just had their bids judged and cash allocated.
Business group the Confederation of British Industry welcomed the plan.
“Growing local economies requires bold thinking, big ideas and commitment,” said deputy director Katja Hall.
Spending in London includes £55m on higher education, £70m paid to councils to increase building, and £200m on the rent-to-buy scheme.
“By trusting local people, backing business and investing in infrastructure, skills and housing, we can create thousands of new jobs,” said David Cameron.
But Labour said it was not ambitious enough, pointing to Lord Adonis’ plan to devolve £30bn to local authorities.
“The announcement falls far short of Labour’s plans, with only a small fraction of the £30bn being devolved, and no decentralisation of powers over skills, infrastructure and employment,” said shadow business secretary Chuka Umunna.